Operators hope to bring new life to Spindletop

Published 5:16 am, Friday, December 27, 2013

BEAUMONT -- Hard-hatted roughnecks returned to Spindletop, aiming to make another historic strike on the storied grounds.

"This is one of the best Christmas presents I have ever had, getting this well spudded on the 22nd of December," said Bud Tippens, a landman who has worked on the Southeast Texas project since 1999.

"Spudding" a well means getting it started, and under crystal-blue skies on Monday the sprawling worksite was teeming with workers and heavy equipment. Trucks ferried in tanks of drilling mud and flatbeds full of pipe. Long sections of that pipe were connected together and fitted into the freshly drilled well hole, as mud splashed up from below.

Once that pipe reaches 10,000 feet, probably around the third week of January, a team of geologists will arrive to begin analyzing the findings to see if there really are deep undiscovered pockets of oil and gas at the Spindletop dome, site of the huge discovery in 1901 that transformed the oil industry and American life.

"It's a wildcatter's dream," said Chet Pohle, a geophysicist for E&B Natural Resources, the project operator and one of its main investors, which believes the new find could rival past discoveries. "It could be so prolific."

The Spindletop well, just south of Beaumont, initially produced about 55 million barrels from the shallow reservoirs tapped in the early 1900s. A 1926 discovery of the Miocene formation led to another 80 million barrels of oil, while deeper discoveries in the 1950s and 1960s produced nearly 20 million more barrels.

14,500-foot well

The current group of investors, which includes California-based E&B, Salt Lake City-based International Petroleum and other private entities, plans to go deeper yet in search of oil and gas.

The new 14,500-foot well is being drilled to verify how deep certain layers of sand, called the Yegua formation, extend on the edge of the Spindletop dome and the amount of oil and gas they may contain.

It could lead to the first new commercial discovery at the famous site since 1963, when on the northwest side of Spindletop, the Frio, a geological formation about 8,000 feet deep, was drilled.

If successful, the relatively expensive $8 million well will provide tangible evidence for an idea that an expanding group of independent geologists, geophysicists, landmen and investors has been developing -- plotting, planning and culling seismic data for geologic clues -- for more than a decade.

"Blood of the well"

An earlier well drilled by some of the current investors in 2007 proved the theory that Yegua reservoir sands do exist near Spindletop, said Bill Whaling, one of the original geologists who developed the project. But that well's location ended up being too close to the salt dome, making production marginally economic.

Data from that well, and subsequent years of seismic analysis, propelled the latest drilling.

"We know the sand is there," said Brian Kalinec, an independent geophysicist who has spent years analyzing the seismic data used to develop the geological theories justifying the well. "The risk is whether we will have it in sufficient quantities to make a commercial well."

Over the next 60 days, toolpushers, mud loggers, roustabouts, cement and casing specialists, rig managers, engineers, company men and a fleet of service providers will be in the business of finding out.

They include a number of experienced hands like Sherman Smith, well manager for Precision Drilling. He has spent decades in the industry.

"I am the one drilling the well," Smith said. "My job is all the problems and getting everything lined up to drill the well."

That work will be done in 90-foot intervals, with workers simultaneously connecting a pipe while drilling the next interval. Once they have drilled deep enough for the pressure and geology to change, they will pull the drill pipe out, prepare the well hole and then run a steel liner, called a casing, into it, followed by cement to hold the casing in place.

The cement and casing protect the well against the geological pressure that grows as the well goes deeper.

While the drilling is progressing, mud-logging engineers will monitor the density of the mud coming out of the well. Deciphering that data will clue them in about the kinds of rocks and hydrocarbons trapped below.

They will also be watching the well pressure with an eagle's eye, vigilantly working to prevent either a well collapse or a blowout, which can occur if the pressure from the mud going into the well does not counterbalance the pressure of the well.

"Your mud is the blood of the well," said Brian Broussard, the drilling consultant for E&B, who is monitoring the operations to make sure that drilling proceeds as expected. "Without the mud, everything collapses."

Rich or a bust?

When the well reaches its targeted 14,500 feet, the investors and geologists will then study the data to determine the next steps.

If the sands are devoid of hydrocarbons, they could plug the well and go home. But a thick layer of oil-rich sands would lead them to start plans for production.

If they find something in between, they might drill to the salt level, just to figure out what exactly is down there. At that point, they could also develop possible contingency wells from shallow reservoirs to cover the costs of the well.

"Until you actually drill the well, there is still a risk, because the earth is what the earth is," Pohle said. "You don't know what it is going to give up to you."

But until the data start pouring in, the Spindletop investors can only hope that their dreams will end in wild riches, rather than the kind of wisdom that comes from painful experience.

"A lot of work has been done at this point," Kalinec said. "The drilling of the well is up to these guys. We are watching and waiting, and of course, always hoping, but it is obviously in capable hands and that is something."